Their wishes seemed to come partially true in early October when posted base oil prices settled into a fairly stable pattern. However, they remained exposed to downward pressure-something which was to be expected as the market entered the last quarter of the year. In fact, September brought a round of price decreases, which wasn't a complete surprise because historically it is not unusual to see producers lower their prices to encourage orders and place surplus volumes during the second half of the year. In early September, paraffinic pro- ducers informed their customers that they would be reducing postings by 20, 30, 35, 40, 45 and 50 cents per gallon, depending on the grade and the producer, between Sept. 1 and Oct. 1. This string of adjustments was initiated by Motiva, which communicated 20- and 50-cent-per-gallon downward revisions on its base oil grades, effective Sept. 1. This was likely prompted by softer crude oil and feedstock prices, along with lengthening base stock supply. While demand tends to slow down and supply becomes more plentiful in the last few months of the year, some corners of the base oils market seemed to be tighter than others. But finding enough product in the domestic arena did not appear to be a problem. Most buyers try to use up existing inventories as much as possible, and both producers and buyers start to release some of the extra stocks they kept during hurricane season.
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